AMC shares drop more than 35% after new stock sale, halting monster rally fueled by retail traders


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The AMC Empire 25 off Times Square is open as New York City’s cinemas reopen for the first time in a year following the coronavirus shutdown, on March 5, 2021.
Angela Weiss | AFP | Getty Images

The AMC Entertainment buying frenzy continued as shares of the movie theater chain jumped in extended trading on Wednesday.

The meme stock was up about 7% after the bell.

The move comes after the meme stock soared 95% in the regular trading session Wednesday to close at an all-time high of $62.55. Its previous closing record of $35.86 was reached in 2015, according to FactSet data.

AMC’s stock spiked as hit an intraday high of $72.62, well above its previous intraday record of $36.72.

Trading was halted several times Wednesday as shares were up more than 100% at one point. At the end of the day, more than 710 million shares exchanged hands. That’s nearly double the number of AMC’s shares outstanding. The company’s 30-day average volume is just 143 million shares.

Retail investors — many active on Reddit’s WallStreetBets forum — led the AMC rally, and AMC executives have taken note. On Wednesday, the company announced a new portal to connect with individual investors and offered free popcorn, exclusive screenings and other perks to those who hold its stock.

Wednesday’s wild trading activity comes even after an investment firm reportedly sold off its stake in the company. On Tuesday, AMC revealed it sold 8.5 million newly issued shares to Mudrick Capital, the latest in a series of capital raises for the stock. The hedge fund later sold all of its AMC stock for a profit that same day, according to Bloomberg News.

— With reporting by CNBC’s Sarah Whitten.

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